Analysis and trading recommendations for the EUR/USD pair on July 22, 2020

Trading recommendations for the EUR/USD pair on July 22

EUR/USD

Analysis of transactions

The "buy" signal presented for the European currency worked perfectly. An entry point was formed in the market, after the quote tested the value 1.1448 (green rectangle in the chart). Such led to a 15-point growth in the euro, after which it rose even more due to the news on coronavirus vaccine. Traders began to open long positions, which led to the test of the daily target 1.1490.

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The euro will continue to rise today because traders are confident amid the approval of the 750-billion assistance package of the European Union. In addition, there were good nes on the development of the coronavirus vaccine, which will continue to fuel a rapid economic recovery. Today, a speech by ECB head Christine Lagarde is scheduled, which may support the euro.

Thus:

  • Buy positions when the quote reaches the level of 1.1547 (green line on the chart), targeting the level of 1.1580. The rise may occur after ECB president ECB Christine Lagarde delivers her speech on the state of the European economy. Exit the market when the quote reaches a value of 1.1547.
  • Sell positions when the quote reaches the level of 1.1521 (red line on the chart), targeting the level of 1.1493. This is because the pressure on the euro may increase if the ECB President announces poor prospects for economic recovery after the pandemic. Exit the market when the quote reaches 1.1493.

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Analysis and trading recommendations for the GBP/USD pair on July 22, 2020

Trading recommendations for the GBP/USD pair on July 22

GBP/USD

Analysis of transactions

The "buy" signal presented for the British pound worked perfectly. The quote was able to test the level of 12674 in the trading chart (green rectangle), which led to a 40-pip increase in the pound. In addition, the decline in the quote which occurred in the second half of the day led to a rise to the area of the daily target 1.2725, where it was necessary to exit the market.

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However, the pressure on the pound may return, so be careful with buying positions at current prices. At the moment, there are no news regarding Brexit, but the topic remains rather painful for the British pound, as any news about it may lead to a sharp decline.

Thus:

  • Buy positions when the quote reaches the level of 1.2738 (green line on the chart), targeting the value of 1.2776 (thicker green line on the chart). Good Brexit news will push the pair higher. Exit the market when the quote reaches 1.2776.
  • Sell positions when the quote reaches 1.2713 (red line on the chart), which coincides with the lowest level reached today. The test of it will lead to a fall to the level of 1.2675, where it is best to exit the market since many traders opened long positions from this range yesterday, and it could happen today as well.

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Bitcoin Cash vs USD now trying to fill Liquidity Void: Analysis for July 22, 2020

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On the 4-hour chart, we see that Bitcoin Cash vs USD now is trying to fill the Liquidity Void below the current price. If the bearish momentum is strong, then the 220.18 level is likely to be touched as long as BCH/USD does not retrace upwards and closes above 231.96. If this level is passed, the scenario for filling the Liquidity Void below the current price will be automatically canceled.

(Disclaimer)

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Brief trading recommendations for EUR/USD, GBP/USD and USD/JPY on 07/22/20

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The most active trading instrument of the past day is considered to be the EUR/USD currency pair, which completed the lateral fluctuation of 1.1400/1.1460, breaking through the upper border, during which the European currency rushed towards the values of 1.1500-1.1550, which is considered an inertial move on the market. Such a rapid strengthening of the price leads to overbought, where market participants, due to the risk of correction, begin to close previously opened buy positions, which leads to a slowdown in the inertial course and as a fact of correction in the market.

Based on the above, it can be assumed that it will serve as a kind of resistance in the area of 1.1550/1.1600, where market participants will start fixing previously opened deals, which will lead to a reverse price movement.

Sell positions will be considered below 1.1515, towards 1.1475.

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The GBP/USD currency pair, in the wake of the upward move, managed with surgical precision to approach the price level of 1.2770, which has repeatedly played the role of resistance in history, stopping and reversing the quote. The price approaching the level of 1.2770 was no exception, the natural basis played its role in the market, the quote gradually moved to a decline, where traders received a sell signal. Based on the already existing signal, it can be assumed that if the price consolidates below the level of 1.2710, the downward interest will continue, directing the quote towards the values of 1.2685-1.2620, forming a correction in the market.

An alternative scenario, which every trader should have, considers keeping the quote within the values of 1.2720/1.2770, which will mean a prevailing upward interest, which does not make it possible to fulfill the logical basis and adjust the value of the pound. In this case, it is worthwhile to carefully analyze the price fixing points above the value of 1.2770, as this may signal a further upward movement of the price in the direction of the values 1.2810-1.2885.

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For the USD/JPY currency pair, a sharp downward movement can be noticed, during which the quote approached the area of 106.70/106.90 once again, where the pivot points were previously found. A consistent deceleration of the price in the same coordinate indicates a logical basis that traders operate in when fixing previously opened deals, as well as opening new deals in the event of a rebound or breakdown of the price level.

Therefore, depending on whether the price consolidates below or above 106.70 / 106.90, the next direction of price movement can be predicted.

It is recommended to sell the pair at a price below the level of 106.70 with the prospect of a move to 106.40-106.00.

It is recommended to buy a pair at a price above the level of 106.90 with the prospect of a move to 107.20.

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GBP/USD: plan for the European session on July 22 (analysis of yesterday's trade). Pound may sharply fall against US dollar.

To open long positions on GBP/USD, you need:

Buyers of the pound achieved their goal yesterday and reached the previously indicated resistance levels, forming a good signal to open long positions, which I paid attention to in my review for the second half of the day. Let's look at it in more detail. If you look at the 5-minute chart, you will see how after the bulls' first entry into the market in the middle of the European session, buyers did not hesitate and did a similar trick at the beginning of US trading from the 1.2668 level, which only added optimism to the market and led GBP/USD to the resistance area of 1.2742. From this level, the bears tried to build a downward correction, which was only fully implemented in the Asian session. At the moment, it is very important for the bulls to take control of the resistance of 1.2737, since consolidating it will be a signal for opening long positions in the pound in order to continue growth to the high of 1.2809, where I recommend taking profits. The long-term target is the resistance of 1.2906. However, be careful with purchasing at highs, as a bearish divergence may form on the MACD indicator. It is best to look at buying the pound after a downward correction from the support of 1.2676, where the moving averages also pass, but only if a false breakout is formed there. I recommend buying GBP/USD for a rebound only from the low of 1.2625, based on a correction of 30-40 points within the day. Let me remind you that the COT report for July 14 indicated that there was an increase in short non-commercial positions from the level of 56,300 to the level of 56,761 during the week. Long non-commercial positions rose from the level of 39,892 to the level of 43,175. As a result, the non-commercial net position decreased its negative value to -13,568, against -16,408, which indicates that the market is still under pressure, but there are fewer who are willing to sell.

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To open short positions on GBP/USD, you need:

Sellers have a great chance to return to the market, but it takes some hard work. First of all, you need to prevent a breakout of the 1.2737 resistance and form a false breakout on it, which will be the first signal to open short positions. The purpose of such an entry is for support at 1.2676, consolidating below it will only increase the pressure on the pound, which will lead to a complete overlap of yesterday's growth and updating the low of 1.2625, where I recommend taking profits. With the growth of GBP/USD above the resistance of 1.2737 in the first half of the day, you can hope for a divergence to form on the MACD indicator, which can occur immediately after updating yesterday's high. The upper border of the Bollinger indicator is also located there. If there are no sellers at this level, I advise you to postpone short positions until the high is updated at 1.2809, or sell the pound immediately on a rebound from the resistance of 1.2906, counting on a correction of 30-40 points by the end of the day.

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Indicator signals:

Moving averages

Trading is conducted just above the 30 and 50 moving averages, which indicates that the advantage of buyers of the pound remains.

Note: the period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

A break in the lower border of the indicator around 1.2680 will increase the pressure on the pair. Growth will be limited by the upper level of the indicator in the area of 1.2765.

Description of indicators

  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
  • MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Fast EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial traders are speculators, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Short non-commercial positions represent the total short open position of non-commercial traders.
  • The total non-commercial net position is the difference between short and long positions of non-commercial traders.
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EUR/USD: plan for the European session on July 22 (analysis of yesterday's trade). Bulls awaken and are buying up euros.

To open long positions on EUR/USD, you need:

The news about the breakthrough in the development of a vaccine against COVID-19 and the decisions made at the EU summit woke up the bulls, who began to buy the European currency in batches during the US session, creating several signals to open long positions. Let's take them apart. If you look at the 5-minute chart and recall yesterday's recommendations, you will see how the bulls broke through and consolidated above the resistance of 1.1466, which formed the first signal to buy the euro. As a result, the pair quickly reached the resistance of 1.1514, where after a short stop, another entry point into long positions was formed. This pulled EUR/USD under the resistance of 1.1539, where it was possible to observe partial profit-taking. At the moment, euro buyers are looking for the 1.1548 level, consolidating above it will lead to forming a new signal to open long positions in continuing the bullish trend with an update to the high of 1.1605. A large resistance at 1.1648 is still the long-term goal, where I recommend taking profits. In the event of a downward correction, and this is quite acceptable due to the lack of important fundamental data in the morning, it is best to postpone long positions until an update of the low of 1.1508, with the condition of forming a false breakout there. Otherwise, I advise opening long positions only for a rebound from the support of 1.1469, where the moving averages are also based for a rebound of 25-30 points within the day. Let me remind you that the Commitment of Traders (COT) report for July 14 recorded an increase in long positions and a very small rise in short ones, which indicates a gradual increase in demand for risky assets. There are more and more people willing to buy euros in current conditions and at high prices, which may lead to further growth in the medium term. The report shows an increase in short non-commercial positions from the level of 881,562 to the level of 83,340, while long non-commercial positions jumped from the level of 185,159 to the level of 194,252. As a result, the positive non-commercial net position increased to 110,912, against 103,597, which indicates an increase in interest in purchasing risky assets at current prices.

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To open short positions on EUR/USD, you need:

Sellers tried to return to the market several times yesterday, even forming a sell signal for the euro in the morning, which I analyzed in detail. However, this did not lead to a larger bearish sell-off. At the moment, sellers are focused on protecting the 1.1548 resistance, forming a false breakout there in the morning and returning to this range will be a signal to open short positions while expecting a downward correction to the support of 1.1508. However, an imperative task for bears is to break through this range and overlap yesterday's bullish momentum with an update to the low of 1.1469, where I recommend taking profits, since there are also moving averages that limit the downward potential. In case of further growth in the absence of fundamental statistics and negative news on the eurozone, I advise you to defer short positions to update the high of 1.1605 or sell EUR/USD immediately on a rebound from resistance at 1.1648, based on a correction of 25-30 points within the day.

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Indicator signals:

Moving averages

Trading is conducted above 30 and 50 moving averages, which indicates the likelihood of a further bull market.

Note: the period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

Growth will be limited by the upper level of the indicator around 1.1585. In case the pair declines, support will be provided by the average border in the area of 1.1508, and you can buy euros immediately on the rebound from the lower border of the indicator in the area of 1.1427.

Description of indicators

  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
  • MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Fast EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial traders are speculators, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Short non-commercial positions represent the total short open position of non-commercial traders.
  • The total non-commercial net position is the difference between short and long positions of non-commercial traders.
The material has been provided by InstaForex Company - www.instaforex.com

Dollar has nothing left to do but decline (EUR/USD and USD/CAD pairs are expected to make a correction before the dollar

A surge of optimism regarding the results of successful trials of vaccines against coronavirus infections, conducted by a number of US pharmaceutical companies, gave investors hope that drug production will begin in the near future.

Markets rallied again on Tuesday, driving up demand for stocks in companies that had previously experienced widespread problems due to the impact of the pandemic. On this wave, the US dollar expectedly came under pressure and continued to decline to a basket of major currencies, and not only to them. Its weakness is natural given the direct dependence of the demand for dollars as a safe-haven currency, which manifested itself again in the spring and summer of this year in the wake of the coronavirus pandemic, on the demand for company shares.

Earlier, we have repeatedly pointed out that large-scale stimulus measures in the United States fundamentally weaken the US currency, but this weakness was constrained by the high risks of the consequences of COVID-19 for the country's economy, which led to a decline in the value of company shares, crude oil and other commodity assets. But at the moment, with one drug company after another reporting successful trials, it is already becoming clear that mass production of vaccines is likely to begin in September and the reign of COVID-19 will decline markedly. In this case, the fundamental weakness of the dollar will come to the fore, which may quite significantly decline in the long term, primarily in relation to highly profitable currencies, commodities and, of course, to the euro and pound.

We believe that such a scenario of the development of events will already be implemented, as they say now. The decline in the US currency rate, which began against the basket of major currencies three months ago, will only strengthen.

On the other hand, important economic data will be released today, which can only push the dollar to a further decline if it turns out to be above expectations. These are the values of sales in the secondary home market for the month of June in the United States. They are expected to rise to 4.78M on a monthly basis from 3.91M. In percentage terms, growth may amount to 24.5% against 9.7%.

Forecast of the day:

The EUR/USD pair surged on a wave of rising demand for risky assets and the EU's agreement on the Recovery Fund. It could correct to the level of 1.1485 before continuing to rise to 1.1615.

The USD/CAD pair has pulled out of the range of 1.3485-1.3665 amid optimism about COVID-19 vaccine production and higher crude oil prices. The pair may also correct upward to the level of 1.3485 in order to try to continue declining to 1.3370.

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Elliott wave analysis of GBP/JPY for July 22, 2020

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GBP/JPY has broken the first minor resistance at 135.92. It is likely to rise to 139.80 and break above this resistance too. Support is now seen at 135.52 and again at 135.09. The pair may break above 135.92 climbing higher towards 139.80.

R3: 138.50

R2: 137.30

R1: 135.92

Pivot: 135.71

S1: 135.52

S2: 135.09

S3: 134.70

Trading recommendation:

We are long GBP at 135.48 and we have placed our stop at 134.05

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Elliott wave analysis of EUR/JPY for July 22, 2020

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The EUR/JPY pair did not dip to 121.90 as we forecast. On the contrary, it started moving up again. The minor corrective dip only reached 122.44 before EUR/JPY rose again towards the next target at 124.43. The resistance level should be broken too for a continuation higher to 125.82-129.26.

Support is now seen at 122.98 and at 122.44.

R3: 125.24

R2: 124.43

R1: 123.42

Pivot: 122.98

S1: 122.44

S2: 121.90

S3: 121.78

Trading recommendation:

We are long EUR from 122.51 and we have our stop placed at 121.75

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Ethereum price movement forecast, July 22, 2020.

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On the 4 hour chart, Ethereum is trying to break through the Liquidity Void bellow its current price and reach the 238.23 level. It can be seen on the Stochastic Oscillator showing the overbought level and trying to close bellow the 80 level. This scenario is likely to come true if the pair dies not rise and close above the 246.33 level.

(Disclaimer)

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Trading plan for EURUSD for July 22, 2020

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Technical outlook:

EURUSD rallied past a major resistance around 1.1500 yesterday. The single currency pair is seen to be trading around 1.1533 level at this point in time and is expected to turn lower towards 1.1167 level from here. Please note that a major boundary seems to be in place between 1.0636 and 1.1540 respectively. The entire rally now needs to be retraced and the first level is seen around Fibonacci 0.382, which is close to 1.1167 support. Trading point of view, traders might now prepare to sell on a bearish reversal around 1.1540. Immediate support is seen towards 1.1167, while resistance is already where EURUSD trades right now. Watch out for a sharp reversal lower from here.

Trading plan:

Remain short now, stop @ 1.1600, target @ 1.1167 and below.

Good luck!

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GBPCAD approaching support, potential bounce!

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Trading Recommendation

Entry: 1.70751

Reason for Entry: Ascending trend line, horizontal overlap support, 78.6%, 38.2% fibonacci retracement and 78.6% fibonacci extension

Take Profit: 1.71571

Reason for Take Profit: Horizontal swing high resistance

Stop Loss: 1.70285

Reason for Take Profit: 127.2% fibonacci retracement

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Forecast for EUR/USD on July 22, 2020

EUR/USD

The euro rose by 78 points yesterday due to information that the 750 billion euro fund for the EU's recovery from coronavirus has finally been created. The momentum that the euro received could still grow towards the yet-to-be-reached target of 1.1560, possibly to 1.1620, but along with the fading news itself and local market overheating, which is signaled by the Marlin oscillator forming a divergence with the price, a subsequent reversal of the euro down into the range of 1.195-1.1265 is likely.

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The price is growing above the balance and MACD lines on the H4 chart, the Marlin oscillator is actively growing and is close to overbought.

The current situation in the euro is such that it is no longer advisable to buy, and too early to sell. Even if we assume the option with a further medium-term rise of the single currency, it is better to wait for the price to pull back, which will occur, at least, in the range of 1.1420/65.

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Forecast for AUD/USD on July 22, 2020

AUD/USD

The Australian dollar expectedly increased yesterday, which turned out to be quite strong, and gained 110 points. A triple divergence practically formed on the daily chart according to the Marlin oscillator.

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The Marlin signal line only has a few millimeters left to move up until it actually touches the divergence line. Of course, touching the line is not a prerequisite. The price may grow a little more, just without the mandatory condition of reaching the target level of 0.7190, for today, perhaps tomorrow, we are waiting for a reversal in the medium term. The price falling below the 0.7080 level will be the first signal of such a reversal.

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There is a second benchmark for turning the price into a medium-term trend on the four-hour chart – the blue MACD indicator line. Consolidating the price below 0.7040 is a more confident signal for further decline.

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Forecast for USD/JPY on July 22, 2020

USD/JPY

The Japanese yen strengthened by 45 points on Tuesday - investors began to buy it on fears of a new wave of falling stock markets. Stock indexes feel overheated despite seemingly optimistic news from around the world, such as the agreement within the EU on a mutual aid pact, good growth in construction in China, positive tests of coronavirus vaccines. The US stock market closed mixed yesterday: S&P 500 0.17%, Nasdaq -0.81%. Perhaps, investors may prefer to take profits before the US administration meets regarding a new aid package worth 1 trillion dollars.

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The price went under the MACD line on the daily chart, the Marlin oscillator is declining in the negative zone. We are waiting for the price at the previously defined goal of 105.63 – on the price channel line.

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The four-hour chart shows that the price only turned down from the resistance of the MACD line on the fifth attempt. Yesterday, the price was exactly marked at the signal level of 106.68 and now it has to overcome it for further movement to the goal of 105.63. The Marlin Oscillator is in the negative trend zone, which is also a sign that the price will continue to decline.

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Hot forecast and trading signals for the GBP/USD pair on July 22. COT report. Coronavirus hits the dollar and adds confidence

GBP/USD 1H

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The GBP/USD pair continued its upward movement on Tuesday without any doubts. Buyers significantly found the strength to overcome the resistance area of 1.2636-1.2660, from which the price had previously rebounded at least four times. There was no stop there today. Thus, the bulls brought the pair to the second resistance level of 1.2755 by the end of the day. Now the nearest target for long positions is the June 10 high at 1.2812. There are no trend lines or channels at this time, which makes it somewhat difficult to determine the trend, the size of pullbacks and corrections. However, in any case, the bears are now openly resting and do not think about intercepting the initiative.

GBP/USD 15M

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Both linear regression channels are directed upwards on the 15-minute timeframe, which corresponds to the general trend that has developed on the higher chart. There are no signs of corrective movement. The latest Commitment of traders (COT) report showed minimal changes compared to the previous one. The British currency mainly continued to strengthen until July 14 (the final date of the report), so it is not surprising that at this time, according to the report, non-commercial traders continued to open Buy-contracts. The non-commercial category only opened 182 Sell-contracts (and only 12 a week earlier). However, the beginning of a new week gave the pair a chance to overcome the 1.2636-1.2660 area, which returned traders' interest in buying the pound. Thus, the pound sterling has become more expensive again from July 15 to the present day (the final one for the next COT report). This means that the new COT report may show an increase in the net position. If this trend continues, it will raise the chances of strengthening the pound further.

The fundamental background for the GBP/USD pair seems to have completely shifted towards the coronavirus theme. In recent weeks, we have repeatedly concluded that the US dollar is falling against its main competitors, solely due to the difficult epidemiological situation in America, and, as a result, the almost complete inaction of the White House in countering the epidemic. We also noted that US President Donald Trump is concerned about his re-election prospects and the US economy, rather than the fact that the United States is ranked first in the world in terms of the number of diseases and deaths from the "Chinese virus". From our point of view, all this played a significant role in forming a low demand for the dollar. At the beginning of this week, data came from the UK that scientists at Oxford University made a breakthrough in creating a vaccine against the coronavirus. The pound sterling jumped with new forces following this information. Thus, new information on the coronavirus from Britain and the United States could once again affect the mood of the market. Especially since Trump resumes briefings on the coronavirus, so we can get a new batch of funny comments in the near future. As for the average economic data, they don't exist. There is no news on the most exciting Brexit topic for the GBP/USD pair. The end of July has already arrived, and British Prime Minister Boris Johnson is not even going to Brussels yet. However, in recent days, EU leaders have been busy with the EU summit. So in the coming week, we are still waiting for information from Johnson in the capital of Belgium.

There are two main scenarios as of July 22:

1) The outlook for the bulls continues to be very welcoming. Buyers managed to overcome an important resistance and now the pair's quotes can add another 100 points. Thus, you are advised to buy the pound while aiming for 1.2812 and 1.2846, if traders manage to confidently overcome the current target of 1.2755. Potential Take Profit in this case will amount to another 40 to 80 points.

2) Sellers are advised to consider short positions with goals of the Senkou Span B line (1.2554) and the support level of 1.2474, but to do this, you need to wait until the Kijun-sen line (1.2638) is overcome. In any case, this is not a plan for the next few days, since the price is very far from Kijun-sen, and the fundamental background does not allow us to count on the dollar's firm growth yet. Potential Take Profit ranges from 60 to 150 points.

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Hot forecast and trading signals for the EUR/USD pair on July 22. COT report. Market participants unimpressed with summit

EUR/USD 1H

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The euro/dollar pair continued an indistinct upward movement on the hourly timeframe of July 21 for most of the day with frequent pullbacks and corrections. However, buyers sharply intensified and began new mass purchases of the European currency in the US trading session. It is difficult to say what exactly happened in America at this time, since the pound also began to firmly grew. Thus, it is hardly a matter of the results of the EU summit, which has nothing to do with the pound. Anyway, the upward trend continued, and traders managed to bring the pair to the resistance level of 1.1544, calmly overcoming the psychological level of 1.1500. Now we expect a round of downward correction. Bears' positions remain extremely unattractive, and the ascending channel clearly indicates an upward trend.

EUR/USD 15M

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Both linear regression channels are directed upwards on the 15-minute timeframe, signaling an upward trend in the most short-term plan and no signs of an emerging trend change. According to the latest COT report, the non-commercial category of traders (the most important and significant) opened new 9,648 Buy-contracts and a total of 3,719 Sell-contracts during the reporting week. Thus, the net position in the non-commercial category has grown again and now stands at +112,124. And along with the net position, the bullish mood of traders has also increased. Both large and small. As a result, the European currency continues to grow against the US dollar and there are no prerequisites for completing this process yet. The last working days of the past week also ended with the euro's growth, so the new COT report, which will be released at the end of this week, can also show an increase in the number of Buy-contracts among non-commercial traders. The beginning of the current week is also left for buyers, although the euro has risen in price by minuscule values.

The fundamental background for the EUR/USD pair on Tuesday, we can say, was optimistic. The EU summit ended positively for the entire eurozone. And what is positive for the EU is positive for its currency. However, market participants were not overwhelmed with joy because of the results of the summit, considering them as a necessary decision that was still made. In fact, market participants who refused to make new purchases against the backdrop of the summit are right. After all, now the eurozone will only borrow 750 billion euros to restore the economy. But this 750 billion will have to be given away. And the EU countries will give them not only in the next few years, but up to 2058. At least this is the date that appears now. Thus, the EU has signed up not only itself, but also the next generations to pay back debts, so that now it has a chance to recover. As for ordinary macroeconomic reports, there were no releases in the first two trading days of the week. Neither in the US nor in the European Union. Thus, you are advised to pay more attention to the technical picture, and especially to the ascending channel. Publications or events are not planned in the EU and the United States on Wednesday, July 22. The US dollar may continue to fall in price if the coronavirus situation does not improve in the country.

Based on all of the above, we have two trading ideas for July 22:

1) Buyers clearly continue to dominate the market, and the price has gone even higher than the ascending channel. At the same time, the upward movement increased. Buy orders remain relevant with the target resistance levels of 1.1544 and 1.1631. Any of them can lead to a rebound and correction within the ascending channel. Potential Take Profit is up to 80 points in this case.

2) Bears are now simply resting and waiting for buyers to give them a chance to take the initiative in the market. Sellers still do not have enough strength to form a new downward trend. Thus, we can only wait for the price to consolidate below the Kijun-sen line, and ideally - below the ascending channel, and only then open sell positions with the support levels of 1.1335 and 1.1242. The potential Take Profit in this case is from 40 to 130 points.

The material has been provided by InstaForex Company - www.instaforex.com

Overview of the GBP/USD pair. July 22. Trump is again going to use the services of security forces to suppress rallies in

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - upward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 209.9669

While the European currency is trading fairly calmly (if you do not take into account last night), the British pound continues to "tear and throw". Over the past two trading days, the pound has grown by at least 200 points. And this is despite the fact that no over-positive fundamental or macro-economic background has been received from the UK these days. There is no news on Brexit, no news on the state of the UK economy, no news on the "coronavirus". The only thing that can be noted and really happy for Britain is the breakthrough in the development of a vaccine against COVID-2019 by Oxford scientists. According to the latest data, thanks to the new vaccine, patients develop an immune response, in other words, the body produces antibodies that are able to fight the "coronavirus". However, it is also reported that the end of the development of the vaccine is still very far away, since now it is only waiting for the third round of testing, in which the vaccine will be tested on people at risk (the elderly, employees of medical institutions). It is reported that such a test requires thousands of test subjects, and it can last several months, since it must take a long time to understand how the vaccine acts on a not completely healthy body and what consequences it can cause. It should also be recalled that there are at least 150 vaccines currently under development around the world. That is, not only the UK is involved in the development and has certain positive results. However, the rise of the British currency in recent days could still be caused by the success of scientists at the University of Oxford.

While the UK is actively working on the development of a vaccine, in the US, rallies and protests continue, caused by the murder of a black man, George Floyd, by a white police officer. And President Donald Trump has returned to the idea of bringing in special units to stop mass riots, which are not. The leader of the American nation intended to send additional units of federal law enforcement officers to those cities where the unrest continues. In particular, we are talking about such giants as New York and Chicago, where the local government is either purposely inactive, or simply afraid to further provoke rebellious Americans. Donald Trump says that the security forces sent to Portland on his orders "did a fantastic job", but local officials say that the intervention of security forces only makes the situation in the city worse. Leaders of several states (probably Democrats) accused Trump of deliberately resorting to the services of intelligence agencies for political purposes before the election.

At the same time, the odious leader of the United States almost openly declared that he would try to resist the will of the American people with all his strength if he lost the presidential election in November. A Fox News reporter asked Trump if he is ready to accept any election result in November? To which Trump responded: "I must see them first. No, I'm not just going to say yes. I'm not going to say no." Thus, there is almost no doubt that Biden will be ahead of Trump in the vote, and Trump will try to challenge the results, accusing the Democrats of fraud in his usual manner and trying to act in other not quite honest ways. The US leader also warned the American population that if Biden is elected, the country will be waiting for "destruction". Trump recalled Portland in the context of this issue. "They (the Democrats) will destroy our country. Unimaginable horrors will happen to America. Look at Portland, where politicians do not mind that they have 50 days of anarchy (mass rallies and protests against the background of a racist scandal), although we sent them help (security forces)," Trump said. By the way, the state and city are really run by Democrats (the Governor of Oregon is a Democrat, the mayor of Portland is a Democrat, the state attorney is a Democrat). However, under American law, peaceful protests and rallies are allowed. Accordingly, attempts to disperse demonstrators with the help of security forces are indeed a violation of the Constitution.

Well, while Trump continues to dream of dispersing demonstrators, his political ratings continue to deteriorate rapidly. We have repeatedly noted that by November the situation may change dramatically several times, but at the moment everything looks as if Trump will lose, and half of America is acting against him now. According to the US electoral system, the population of each state does not vote for a particular candidate. Each state, according to the "winner takes all" principle, gives a certain number of "electoral votes" to a particular candidate. The number of "electoral votes" in each state is different and is determined according to the number of residents in the state. In total, 538 "electoral votes" are obtained throughout the country. Thus, if in any state, the winner is Trump, then he gets all the "electoral votes" of that state, and does not divide them with the loser. Thus, more Americans can support one candidate, but another can win if he wins in the states with the largest number of "electoral votes". So, the latest opinion polls indicate that Trump is beginning to lose support in the native Republican states, as well as in the states most "controversial" (or "wavering").

Also, Donald Trump decided to resume holding daily briefings on the "coronavirus". "I think this is a great way to get information to the public," Trump said. It is believed that Trump stopped holding briefings after journalists started asking him a lot of uncomfortable questions that "revealed" a lot of unreliable and outright false statements by the head of the White House and his administration. And of course everyone remembers the story about treatment with ultraviolet light and disinfectants.

Based on this, the upward trend for the GBP/USD pair may continue to form, but after two days of strengthening the pound, a downward correction is also necessary. Previous local highs were overcome, so the bulls showed their intention to continue buying the British currency. On the third trading day of the week, no important macroeconomic publications or other events are scheduled again. However, as we can see, news on the topic of the "coronavirus epidemic" from Britain or the US can have an impact on the foreign exchange market.

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The average volatility of the GBP/USD pair continues to remain stable and is currently 109 points per day. For the pound/dollar pair, this value is "high". On Wednesday, July 22, thus, we expect movement within the channel, limited by the levels of 1.2657 and 1.2875. Turning the Heiken Ashi indicator downward will indicate a downward movement. All Murray levels will be recalculated today.

Nearest support levels:

S1 – 1.2726

S2 – 1.2695

S3 – 1.2665

Nearest resistance levels:

R1 – 1.2756

Trading recommendations:

The GBP/USD pair also resumed its upward movement on the 4-hour timeframe. Thus, the flat was canceled, and buyers returned to the market. Thus, it is recommended to trade for an increase with the goal of 1.2875 (the level of volatility) before the Heiken Ashi indicator turns down. Short positions can be considered after fixing the price below the moving average with the goals of 1.2573 and 1.2543.

The material has been provided by InstaForex Company - www.instaforex.com

Overview of the EUR/USD pair. July 22. Italy will receive 209 billion rubles from the recovery fund, Poland – 160, Spain

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - upward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - upward.

CCI: 332.9041

Well, the epic of the EU summit, which lasted for 4 days, is over. The parties still managed to agree on all the key issues, and the EU leaders can now breathe more freely – the Eurozone is saved! As for the movement of the euro/dollar currency pair, it has not changed at all since the results of the meeting became known. The euro continues to move up with exactly the same amplitude and speed as before, so we can say that market participants simply ignored such an important and historic decision that was made in Brussels. However, this does not mean that this event and decision will not have a long-term impact on the euro/dollar currency pair. After all, now the countries most affected by the "coronavirus crisis" will be provided with financial assistance. This means that their economies and the economy of the European Union as a whole will begin to recover at a faster pace than it could without the 750-billion package. Unfortunately, this 750 billion won't come out of nowhere. They will be attracted to the financial markets and, in fact, will mean a loan for the European Union, which will be redistributed among the most needy countries in the form of the same loans and grants (free of charge). This means that we will have to pay back this 750 billion, and given that this amount is huge even for such a serious organization as the European Union, it will take a very long time to pay it and the interest on it. Thus, it is really impossible to say that a strong event for the euro currency took place in Brussels. The alliance simply decided to take out a large loan, which it will pay back for years. Now we can only pray that there will not be a second wave of coronavirus in Europe, which can again hit the economy. After all, even if Brussels also refuses a new quarantine or "lockdown", it will mean that the economy will slow down. The United States is a clear example of this. A huge number of cases of the disease, but a new quarantine is not being introduced across the country, as Donald Trump, Steven Mnuchin and others believe that it can finish off the American economy. However, if people are afraid of getting sick, their economic activity will decrease significantly. And economic activity is of great importance for the economy.

However, we will not speculate on the coffee grounds whether the second wave will happen in Europe or not. Let's go back to the summit itself and its results. The final budget for 7 years in the European Union will be 1.074 trillion euros. All participants of the summit were satisfied with the agreement reached, and the President of the European Council, Charles Michel, said at a press conference: "Europe is strong, Europe is united. We did it! We have reached an agreement on the budget and the economic recovery fund. It was a difficult negotiation, but it ended with a strong and good deal." "For the first time in history, the budget has been agreed taking into account the solution of climate problems. This agreement is about jobs, health and well-being of the European nation," said Charles Michel. European Commission chief Ursula von der Leyen said in turn: "The budget covers the "green deal". We are investing in the future of the European Union. Europe now has a chance to get out of the crisis." Under the "green deal", the head of the European Commission understands the transition of the European economy to an eco-friendly basis. French President Emmanuel Macron said after the summit that "taking into account the recovery fund, the European budget has actually been doubled for the coming years." "Today we have a seven-year budget and a recovery plan that is approaching 2% of the EU's GDP," said Macron. It is also reported that for the first time in the history of the EU, debt obligations will be on behalf of the entire EU, that is, all EU countries will pay off the debts for the 750 billion euros. Up to the year 2058. Recall that earlier such an idea, called "coronabonds", was repeatedly rejected precisely because of the reluctance of some EU member states to undertake obligations to pay loans and interest on loans, while the money will be provided to other EU countries. "All EU leaders agreed on the need to place common loans and pay off these loans in order to finance the economic recovery," the French President concluded.

And of course Italy is elated. Rome will receive 209 billion euros (about 28%) from the reconstruction fund. Of these, 81 billion are in the form of grants and 127 billion in the form of loans. "We are satisfied because we have approved an ambitious recovery plan that matches the scale of the crisis," Italian Prime Minister Giuseppe Conte said. "Now we must use these funds for investment and reform. We have a real chance to make Italy greener, more digital, more innovative, more sustainable. We have the opportunity to invest in schools, universities, research and infrastructure," Conte concluded. Greece is also happy, which will receive 32 billion euros from the fund, and about 40 more from the EU budget. Its Prime Minister, Kyriakos Mitsotakis, said: "For the first time, our country gets access to such serious financial instruments. We are returning to Athens with a total package exceeding 70 billion euros. This is an unprecedented size for our country." It also became known that Spain will receive 140 billion euros from the economic recovery fund, and Poland – 160.

In addition to the completion of the EU summit on Tuesday no important news and macroeconomic reports available to traders have not been received. Approximately the same fundamental picture will be observed on Wednesday, July 22. Given that the nature of trading on the euro/dollar pair has not changed at all, we still believe that the situation in the United States is important for traders. Namely, the political, social, epidemiological and economic crisis. Congress is currently working hard on the latter, preparing to provide at least another trillion dollars in aid to the American economy. However, most likely, this news will also not find a momentary reflection on the chart of the EUR/USD pair. Thus, the technical picture is now important and according to it, the formation of an upward trend continues. Slow and uncertain. But the bulls continue to buy the euro and get rid of the US dollar, which in recent months has completely lost the status of a currency that everyone always buys. Both channels of linear regression are directed upwards, so there is no doubt about who now dominates the market.

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The volatility of the euro/dollar currency pair as of July 22 is 78 points and is still characterized as "average". Thus, we expect the pair to move today between the levels of 1.1462 and 1.1618. The reversal of the Heiken Ashi indicator downwards signals a turn of a downward correction within the framework of an upward trend.

Nearest support levels:

S1 – 1.1475

S2 – 1.1414

S3 – 1.1353

Nearest resistance levels:

R1 – 1.1536

R2 – 1.1597

Trading recommendations:

The EUR/USD pair resumed its sharply increased upward movement. Thus, it is now recommended to stay in purchases of the euro currency with the goals of 1.1597 and 1.1618, until the reversal of the Heiken Ashi indicator down. It is recommended to open sell orders no earlier than the pair is fixed below the moving average line with the first targets of 1.1353 and 1.1292.

The material has been provided by InstaForex Company - www.instaforex.com

CADJPY holding above ascending trendline! Further push up expected!

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Entry: 79.337

Reason for Entry: Ascending trendline support, moving average support, 50% Fibonacci retracement

Take Profit: 79.734

Reason for Take Profit: Recent graphical swing high

Stop Loss: 79.232

Reason for Stop Loss: 61.8% Fibonacci retracement

The material has been provided by InstaForex Company - www.instaforex.com

Analysis and trading signals for beginners. How to trade the GBP/USD pair on July 22? Plan for opening and closing deals

Hourly chart of the GBP/USD pair

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The situation has become much clearer with the GBP/USD pair, thanks to the first two days of the week. The pair has already reached two goals after the first buy signal was formed, without changing the direction of movement and without correcting every five minutes. Thus, the pound continues to strengthen against the dollar and can already reach the third final goal – the 1.2812 level. The reasons for such a strong growth have already been described in detail in the corresponding article on fundamental analysis. However, we will briefly discuss this issue here. In the UK, scientists are quite advanced in creating a vaccine against the coronavirus, which significantly reduces the likelihood of a second wave of the epidemic in this country, or at least reduces the risk of serious negative consequences of this second wave. After all, there were real hopes that the vaccine against the coronavirus would appear before the new year. It is obvious that in this case, the faster the nation is cured, the faster it will return to a full, normal life. Economic activity of the population, which is extremely important for the economy of the whole country, will be restored. Accordingly, the economy will begin to recover and will no longer be afraid of new waves of the pandemic. That's why the pound is growing now, especially amid the ever-increasing rates of disease in the US. Of course, vaccines are also being developed in the United States, but there is no such optimistic news from there yet. But there is news about the constant confrontation between US President Donald Trump, who belongs to the Republican party, and the Democrats, who lead many American cities and states that are now holding rallies and mass protests against the background of a racist scandal. Also, all Democratic mayors and governors clearly do not seek to follow Trump's calls to restart the economy, remove all restrictive measures and quell mass protests.

Technical analysis makes it possible for the British currency to continue growing. Since the price has overcome the 1.2734 level, the price has no visible obstacles on the way up. At the same time, we advise you to be prepared for a possible pullback and, if you are not ready to lose profit on the previous two buy signals, then close the deals without waiting for the 1.2812 level to be reached. Based on technical constructions, there are two possible scenarios for the development of events:

1) Since the first two targets have been reached and overcome, we have the right to expect the upward movement to continue to the 1.2812 level, which is the June 10 high. Currency pairs are very fond of testing the strength of previous price extremes and turning around them. However, they also love to overcome them, giving us new signals. Thus, the 1.2812 level is very important for determining the further trend. We are placing the Take Profit order just below the level of 1.2812.

2) But sales, from our point of view, are now risky to consider. Of course, you can try to get a signal about a rebound from the level of 1.2812 (if there is one), which will formally allow opening sales, but this is a rather subtle signal that will require additional analysis.

Important speeches and reports (always contained in the news calendar) can greatly affect the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners in the forex market should remember that every trade cannot be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.

The material has been provided by InstaForex Company - www.instaforex.com

Analysis and trading signals for beginners. How to trade the EUR/USD pair on July 22? Plan for opening and closing deals

Hourly chart of the EUR/USD pair

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The first two trading days of the week passed in absolutely indistinct trades and movements in different directions. This happens from time to time in the forex market. If the GBP/USD pair spent several days in such a movement, after which it resumed its normal movement, then the euro only came to its senses yesterday in the afternoon. In fact, this situation means that traders could not decide in which direction to trade. At first glance, the EU summit is over, the European economy will be provided with financial assistance worth 750 billion euros, which will help Italy, Spain, Greece, Poland not collapse under the pressure of the coronavirus crisis. But traders never saw anything optimistic about this. And there is no more news, especially of an economic nature, at this time. Moreover, there won't be any on July 22. The calendar of macroeconomic events clearly indicates this. Therefore, we believe that the euro is not growing, but that the US dollar is getting cheaper (if one currency in a pair is growing, then the second one is getting cheaper; an upward movement is the growth of the first currency (EUR), downward movement is the growth of the second (USD)). The US dollar is falling for the same reasons that we have already announced earlier. Among them is the coronavirus epidemic, which could lead to a new slowdown in the American economy. Thus, the upward movement of the pair may continue, but it is rather problematic to work on signals now - they are often not processed properly.

Nevertheless, technical analysis gives traders the possibility of new sales, although they are somewhat countertrend (positions against the main movement of the pair are considered more risky than trend ones). We have built a narrowing channel with the upper line passing through the price peaks on March 30 and June 10, and the lower line passing through the lows on May 14 and July 10. As a result, when the upper line is reached (if it happens), a powerful movement down to the lower line of the channel could follow. The following scenarios are possible on July 22:

1) Buying the euro is still relevant, but we believe that opening them near the upper channel line is risky, especially after a long upward trend. We advise traders to re-consider buying the euro if the upper channel line is crossed.

2) The price can reach the upper channel line today, from which a rebound and a downward reversal of the pair is very likely. This could happen around the 1.1570 level. Therefore, traders will have a good opportunity to sell the pair near this level, however, we recommend waiting for a rebound from the channel line and not forgetting about Stop Loss (an order that will limit possible losses if the price does not go down). Take Profit order can be placed near the 1.1371 level (near the lower channel line).

Important speeches and reports (always contained in the news calendar) can greatly affect the movement of a currency pair. Therefore, during their exit, it is advised to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners in the forex market should remember that every trade cannot be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.

The material has been provided by InstaForex Company - www.instaforex.com

EUR/USD. Euro woke up and went to conquer price heights

What happened?

The leaders of the European Union were still able to create a fund for the recovery of the eurozone economy following a protracted five-day negotiations. Although the final version of the European Commission's anti-crisis plan differs from the initial one, the fact itself supported the single currency. The results of the July summit should be considered not only from a practical point of view, but also from the point of view of a certain symbolism. The heads of European States have shown that despite all the existing contradictions, they can find compromise options, solving a common problem. In other words, the leaders of the EU countries have demonstrated their "contractual capacity", which is especially important against the background of Brexit and the strengthening of eurosceptic sentiment in a number of European countries.

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It is worth noting that the amount of financial assistance for different European countries will significantly differ. For example, Italy, which is one of the most affected countries, will receive almost 30% or 210 billion euros from the fund. Spain will receive more than 140 billion, Poland with around 160 billion, and Greece with 32 billion (+40 billion euros from the EU budget). Judging by the first comments of the leaders of these states, they were satisfied with this result.

As a result of difficult negotiations, the parties managed to avoid linking the allocation of EU budget funds to issues of the rule of law. The day before yesterday, a serious conflict arose around this issue between the head of the Dutch government and the prime minister of Hungary. The situation has escalated to such an extent that the Hungarian Parliament called on Viktor Orban to block the joint decision of the EU if a new mechanism for freezing EU money for countries that violate respect for common rules and norms, media freedom and the independence of justice is discussed during the summit. There were also certain complaints about Poland yesterday, which has carried out an ambiguous judicial reform (according to the EU leadership, the Polish ruling party has strengthened the vertical of power).

But the parties were able to smooth out the sharp corners: The Netherlands did not insist on a new mechanism, and Hungary and Poland supported the agreed position on the creation of an economic recovery fund and the EU budget.

In addition, subsequent comments from senior politicians and officials provided support for the single currency. In particular, Federal Minister for Economic Affairs Peter Altmaier said that EU funds may become available this year, while the positive results of the summit allow us to hope for the recovery of the eurozone economy in the second half of the year. He also expressed confidence that in 2021 all European states will "return to the path of growth". European Central Bank Vice President Luis de Guindos also voiced optimistic comments. According to his estimates, the decline in the eurozone economy may be "less extensive than previously expected" in the second quarter.

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Therefore, recent events have given market participants confidence that Europe will cope with the consequences of the coronavirus crisis. At the same time, the prospects for the American economy remain vague. The White House is only developing a package of additional incentives, while the corresponding bill has yet to be approved in Congress. The Congress itself is known to consist of the House of Representatives (lower house) and the Senate (upper house). And if the Senate is controlled by US President Donald Trump's party members, the House of representatives is under the hood of his political opponents – Democrats. All this suggests that the White House will have to negotiate with representatives of the Democratic party. And in the context of the upcoming presidential elections (which will be held in the US in November), these negotiations promise to be difficult. Given this fundamental picture, the dollar is under background pressure – and not only against the euro, but also throughout the market.

How to trade?

Immediately after the results of the EU summit were announced, the EUR/USD pair rose to 1.1468, but after that the upward momentum choked. Apparently, many traders adhered to the principle of buy on rumors, sell on facts, so we saw the price slightly retreat in the first half of Tuesday, due to profit-taking and short-term sales.

But if we consider the medium-term prospects of EUR/USD (at least until the end of this week), the pair retains the potential for its further growth. While the sellers do not have any clear arguments for their dominance. At the moment, the pair is testing an important resistance level of 1.1510 – this is the upper line of the BB trend indicator on the weekly chart. If the pair is pinned above this target, it will be possible to consider purchases to the 1.1600 level. As a rule, such a powerful growth is followed by a price pullback, followed by a resumption of the trend. The main task of bulls is to catch such a pullback in order to buy euros at a more favorable price. The support level is the price of 1.1380 – here you can place a stop loss. If the price falls below this level, the growth scenario will lose its relevance.

The material has been provided by InstaForex Company - www.instaforex.com